We've lost a third-rate leader. Now we can concentrate on rediscovering our soul

My compatriots have made my day - no, my whole weekend. Nothing could delight me more than to think that the mean-mindedly blokeish regime of John Howard should finally have been booted out.

I happened to be in Sydney during the previous election campaign in 2004, and felt a deep dismay as I saw how effectively Howard had demoralised Australia and weakened its plucky, cheeky spirit. His foreign policy was fuelled by paranoia; the racism that came so naturally to my parents' generation was mobilised again to create mistrust of Australia's encroaching Asian neighbours. Economic refugees in leaky boats had been beaten back from the shores, or were corralled in internment camps.

At home, Howard pandered to economic uncertainties, balefully droning on about interest rates and mortgage payments. Middle-aged friends of mine thought only of their superannuation payments (abbreviated to 'super' by laconic Aussies); since the funds on which they relied were invested in such companies as News International, it was clear who actually ran the country. The unacknowledged head of the government was Bush, since Howard - who happened to be in Washington on 9/11 - so cravenly courted American protection. And the economy was remotely influenced from New York and California by Rupert Murdoch, who renounced his Australian citizenship to purchase an American television network.

The ugly mood of Howard's Australia is summed up in Richard Flanagan's bilious thriller The Unknown Terrorist, published earlier this year. In one episode some bourgeois profiteers admire Sydney's privatised harbour from a balcony, 'like reptiles waiting to strike'.

Flanagan clearly felt that Howard's Australia was a place he could no longer call home. I myself cringed from a distance last year when the crocodile wrangler Steve Irwin died after being attacked by a stingray: there were solemn suggestions that he should be awarded a state funeral, since in Howard's view he represented the best of Australia.

In the Sixties the journalist Donald Horne characterised Australia as 'a lucky country run by second-rate people'. For a while it was run by a first-rate person, Gough Whitlam, the visionary Prime Minister who was illegally sacked by the Governor-General in 1975; during Howard's time it was run by a third-rate one.

Now, rather than continuing to bask in all that soporific sunlight, Australia should stop counting on its good fortune and begin to wonder about the ownership of its soul. Rather than bragging about what a big, rich country it is, it should set about becoming a great one.

· Peter Conrad is an Australian-born writer and Observer contributor living in London